Obama Says Midterm ‘Shellacking’ to Spur Cooperation

Nov. 4 (Bloomberg) -- President Barack Obama said he takes
the blame for the “shellacking” Democrats suffered in the
midterm congressional elections, as Republicans vowed to use
their new strength to shrink the government and cut taxes.

Obama pledged to find consensus with Republicans on steps
to help the U.S. economy grow and help provide businesses with
the “certainty” they need to expand and hire.

“The voters sent us a message, which is they want us to
focus on the economy and jobs,” Obama said this morning after
meeting with his Cabinet at the White House. He said he told his
department heads, “We have to take that message to heart and
make a sincere and consistent effort to try to change how
Washington operates.”

Obama said he has invited Republican and Democratic
congressional leader to the White House on Nov. 18 to talk
“substantively about how we move the Americans people’s agenda
forward.” White House press secretary Robert Gibbs said the
administration also is discussing holding a meeting with company
executives, though no plans have been set.

Republicans, who seized control of the House and narrowed
the Senate’s Democratic majority in the Nov. 2 election, said
Americans showed they want the government to change course and
find bipartisan solutions to growing government debt and
persistent high unemployment.

‘Some Denial’

“There seems to be some denial on the part of the president
and other Democratic leaders of the message that was sent by the
American people,” House Republican leader John Boehner, in line
to become speaker in January, said in an ABC News interview,
according to a transcript. “The American people have clearly
repudiated the policies they’ve put forward.”

“We can’t expect the president to sign it,” he said today
at the Heritage Foundation. “So we’ll also have to work, in the
House, on denying funds for implementation, and, in the Senate,
on votes against its most egregious provisions.”

The Republican House majority will be able to vote on a
health-care repeal, while McConnell, as minority leader, can’t
force Senate votes. Boehner of Ohio asked colleagues in a letter
today to vote for him to become speaker.

One-Term President

McConnell of Kentucky also defended his earlier statement
that his top political priority was to deny Obama a second term
in office. He said the only way to accomplish Republicans’
policy goals “is to put someone in the White House who won’t
veto any of these things.”

Senate Majority Leader Harry Reid’s spokesman Jim Manley
said in an e-mailed statement that a repeal of the health-care
law would “give power back to big health-insurance companies”
and let them return to practices such as denying coverage to
people with pre-existing conditions.

McConnell said Republicans will “vote to freeze and cut
discretionary spending,” and “push to bring up and vote for
House-passed spending rescission bills.”

The Senate leader described a narrow range of territory
where Republicans and Obama may find common ground. “If he
wants to address spending, debt and private-sector job creation
he will find a willing partner,” he said.

‘Support Our Initiatives’

McConnell also voiced optimism that because 23 Senate
Democrats must seek re-election in 2012, many may join
Republicans “to support our initiatives.”

The Republican Party’s net gain of at least 60 House seats
is its biggest since the 1938 election cycle, when Democrats
lost 72 seats. Republicans, who lost the majority of both
congressional chambers in the 2006 midterm elections, will
assume control of the House in January.

Needing a 10-seat gain to win the Senate, Republicans
picked up at least six seats.

At a news conference yesterday, Obama said voters are
“deeply frustrated” about high unemployment, slow growth and
are concerned about government “overreach” into their lives.

He also took responsibility for changing the
administration’s approach to the business community. Companies
from Procter & Gamble Co., the world’s largest consumer-products
producer, to Caterpillar Inc., the largest maker of construction
and mining equipment, have publicly criticized the
administration.

‘Right Balance’

During the election campaign, Obama repeatedly said
Democrats would defend middle-income taxpayers against corporate
interests like “Wall Street banks” or the “oil industry.”

The administration must find the “right balance in making
sure that businesses have rules of the road and are treating
customers fairly,” Obama said yesterday, “but also making
absolutely clear that the only way America succeeds is if
businesses are succeeding.”

The president said he plans greater outreach to the
business community to get companies to spend some of the almost
$1 trillion in cash that Moody’s Investors Service says they are
holding.

Obama reinforced his message to business today.

“We’ve got to provide businesses with certainty about what
their tax landscapes going to look like; we’ve got to provide
families with certainty that is critical to maintain our
recovery,” he said.

Lame-Duck Session

Democrats will still control both chambers when House
members and senators return to Washington this month for a lame-duck session; Obama wants the lawmakers to extend tax cuts for
most Americans and unemployment benefits. Obama favors extending
Bush-era income tax cuts for families earning up to $250,000,
while letting them expire at year-end for the wealthiest 2
percent of Americans.

Even so, Gibbs said today Obama is “open” to extending
tax cuts for upper-income individuals to win extensions for
middle-income families.

Republicans call for extending all the tax rates enacted by
Congress in 2001 and 2003. Boehner reiterated that position
yesterday, saying that extending all the current tax rates “is
the right policy for our economy at this time.”

Obama said his meeting with Boehner, McConnell and
Democratic congressional leaders would focus on moving ahead,
and he is “absolutely” willing to negotiate on tax cuts.

The current House speaker, Democrat Nancy Pelosi of
California, said in an interview with ABC News broadcast
yesterday that she had “no regrets” about pushing the
president’s agenda through Congress.

Target of Attacks

Pelosi, the first female speaker, said she is considering
whether she will seek to continue as her party’s top House
leader as Democrats become the minority party. Pelosi was a top
target of Republican attacks during the midterm campaign, and
some Democratic House members say a new leader is needed.

“I’ll have a conversation with my caucus. I’ll have a
conversation with my family, and pray over it, and decide how to
go forward,” Pelosi said. “But today isn’t that day.”

Former House Speaker Dennis Hastert, the last Republican to
hold the position, gave up his leadership post after his party
lost the chamber in the 2006 vote. Hastert, of Illinois,
resigned his seat in November 2007.